I had a great time last night speaking at the Tasha Space’s class on “The Value of Brand” – one of the courses offered in Columbia’s Masters in Strategic Communications.
It was a great group of executives from a wide range of industries, all of whom were struggling with the challenge of how to communicate or calculate the financial value of their contribution as marketers. Each framed the challenge somewhat differently. This is what they said they wanted to get out of the session:
- To understand how brands look from a financial person’s point of view
- How to explain the value of marketing to a cynical audience
- How to communicate effectively with business managers
- How to justify a budget for marketing
- How to calculate the ROI on marketing
- How to get more comfortable with numbers
We had a wide ranging discussion that touched on a large number of the themes familiar to regular readers of this blog. I suggested that they remember six things:
- Marketing is valuable because customers are not Vulcans – they care about more than just functionality
- Marketing’s job is to help the business conceive and deliver products and solutions that are both 100% rational and 100% emotional in their appeal
- The goal of marketing is to support sales in the short term, plus to build an asset in the form of a brand and/or corporate reputation that will drive sales in the long term
- Analysis of the role of brand/reputation in the purchase decision allows the financial value of this asset to be estimated – but this is an artificial exercise since the customer is buying the “bundle of benefits” rather than the brand is a discrete element
- Estimates of brand values vary wildly across different providers, undermining the credibility of brand valuation as a “science” that can be used to demonstrate the value of marketing
- The best way of demonstrating marketing accountability is for marketers to show they care about increasing the value of the business by focusing their marketing efforts on the variables to which the value of the business is most sensitive
I had a great time and hope that I was able to equip the executive students with a number of tools and frameworks to enable to engage effectively with their finance colleagues
